Learn: from validation to customer needs

When Microsoft Netherlands wanted to inspire developers, but also “the next entrepreneur" with its cloud platform Azure, they came with a lot of questions.

Challenge

How do you capture profound insights from your customers and how might you use these insights to create real, lasting value for them?

Solution

Through continuous validation, Microsoft was able to co-create and weigh various options for its customers, at high speed, in order to add value continuously. This has led to accelerated growth (2x) in comparison their competitors. The method has been integrated into the daily course of business at Microsoft.

When Microsoft Netherlands wanted to inspire developers, but also “the next entrepreneur”, with its cloud platform Azure, they came with a lot of questions. Mainly, who is our target group and how do they think about technological innovation? Niels Lohuis, Azure Direct & Channel Business Lead, explains how he and his colleagues learned to effectively map customer needs and how the tools are used daily.

The project, to better market Microsoft Azure, took place during an important transformation in the market. “Until recently, Microsoft was an indirect player on the market,” Lohuis begins. “Nobody ordered software directly from Microsoft, there was always a distributor or other party between us and the customer. That has changed. The market now has a huge technical need, and many companies have gained knowledge of their own. That means that many current customers want to buy directly from the supplier.”

In order to respond to this demand from the market, Microsoft had already launched their version of hosted cloud services, called Azure, in early 2010, allowing customers to easily reduce digital products and services. “Do you want to develop a test server, an environment to develop apps, or make complicated calculations? With a push on the button everything is ready,” said Lohuis. You can try Microsoft Azure for free. Due to how easy it is to use and the ability to use open source solutions, Azure is increasingly used by organizations of all sizes. But it can always be better. To trigger more entrepreneurs to think about their business and the opportunities that the Cloud offers to take the next step, Microsoft decided to launch a campaign.

What’s the story?The big question was: how might we reach our target groups and with which story? Microsoft’s business customers are companies of all kinds and sizes. From large multinationals to fresh, young startups. Lohuis: “They all need technological innovation, but also support in different areas. Young technicians have enough software knowledge, but are increasingly confronted with business issues. How do you create a profitable business based of a good idea? On the other hand, the business-oriented customers, who have a lot of business knowledge, are familiar with us because they use Office and their e-mail. They often don’t know that much more is possible. We wanted to grow faster than we already did, and therefore we had to know how to better meet those target groups and respond to their needs.

“The team decided to work with Business Models Inc. to look at the content of the campaign, but also to sharpen the target audience. I would like to bring their use of tools and visual way of working to our customers to help them with those business questions. The use of a dedicated, agile marketing team to get this done also greatly encouraged us. In addition, the approach caused a change within Microsoft. We have become much better in testing, validating assumptions and applying learnings directly to optimize our campaigns.”

Fear and desireThe first thing Microsoft and Business Models Inc. did was to chart the customers and their technology needs. In a world where disruption has become the norm, both existing companies and startups are working on the next step – how do I make sure I still exist as a company tomorrow? Lohuis: “We used Value Proposition Canvas and stepped into our customers’ shoes. What keeps them awake at night? What are the jobs-to-be-done and what are the pains and gains they encounter daily? This resulted in many new insights, painkillers and gain creators. There were roughly two groups of customers: companies operating from fear- how do I survive-, versus companies who desire and see the opportunities that offer new technologies. Some companies find the switch to the cloud still very exciting and are afraid of the consequences. Of course, it is not nothing. How do you get those business customers so far as to embrace new technology in their process?”

Data from contentWith the customer taking center stage, the team went about producing content about the possibilities of Azure. Blogs, short videos and events had to make developers enthusiastic about the service, but also to understand what the customer wants. “During the creation of the campaign, the Visual Game Plans really helped us. These enabled us to put everything in the short run,” said Lohuis. “We determined what we were going to produce and when this was successful. Then we outlined what was needed for that success. As a result, it was immediately clear what everyone had to do and what parties could help. There was simply no excuse for not fulfilling your task. Once the first content was published, testing and validation could begin. The team retrieved valuable data from the quantitative data and weekly interviews with focus groups.”

Every two weeks the team came together to discuss the reactions of the customers. Lohuis: “By getting in touch with our customers, we were able to validate our assumptions and optimize our campaigns. First, that was a little scary, but it provides great insights. Sometimes something resembles the customer, but you do not know exactly why. Then you keep asking questions. For example, we found out that technically-engineered viewers were not really interested in a general story about Azure and how important the cloud is. They just want to know how a specific service works and what’s in it for them. Every two weeks, the team optimized the campaign and followed a new iteration, fed by customer feedback and his need. “

Learning and improvingDuring the intensive project, the team got a much better view of their target groups and the needs of these groups. They needed it. “The anxious group particularly needed trust,” says Lohuis. “They wanted that new technique, but how? Then you hire someone? Are there any other parties who can help? The ‘desire’ group just wanted to get started, and in particular needed business knowledge and accelerating the processes. Thus, they don’t have to reinvent the wheel and can focus on building profitable products.”

According to Lohuis, Microsoft Netherlands really made progress with this project. Not only by gleaning the fresh market insights, but also by learning and incorporating design-led tools and methods at a team level. “Daily check-ins and Visual Game Plans make us faster and more efficient. If someone has an idea today, we bring a canvas to the table, to make our plans visual and tangible. Besides that, we are now much more flexible with our campaigns. Where once the entire process of our campaigns was prepared and decided, now only 25% of our campaigns is confirmed. When the campaign is live, optimization starts and iterations begin. That progress has helped Microsoft Netherlands grow faster than our neighbors. And we double our growth each year. Because we regularly reflect on our progress, we learn continuously.”

Microsoft is a world-class software player and has since its founding in 1975 no longer been thought out of IT. The company is mainly associated with the Windows operating system and the Office package. However, since the advent of CEO Satya Nadella in 2014, the company is committed to cloud computing, the main product of the Azure cloud platform.

How might you incorporate new tools, skills, and a designer’s mindset to interact with and learn from your customers (and non-customers)?